Gambling Law of Chinese Mainland

There are now many forms of legal betting in Chinese Mainland including sports betting, lottery, and virtual terminal games that function similar to slot machines. In 2012 these combined to generate profit of RMB 261.5b (USD $42 billion). If we also include Hong Kong and Macau, on a gambling by country basis, the People’s Republic of China (PRC) ranks number one in overall gambling revenue.

Despite this, many forms of gambling such as casino games, mah-jong, poker and sports betting with non-approved channels are crimes. It is also interesting that we spent centuries trying to prevent gambling, and banned it entirely in 1949, only to become the world’s largest legalised gambling market. In this article I start by covering our current gambling laws. I then cover our history to show how we went from a nation opposed to gambling to one that embraces it. You can then continue to read about how our many forms of legal gambling work.

Gambling Laws of China

Whoever, for the purpose of profit, gathers people to engage in gambling, runs a gambling house or makes gambling his profession shall be sentenced to fixed-term imprisonment of not more than three years, criminal detention or public surveillance and shall also be fined.

You might notice this law is vague and does not make casual gambling a crime. It is still often treated as a crime due to old policy dating back to Mao’s day.

Since 1957, we have had a program called re-education through labour to punish minor offenses of gambling, petty theft, fraud, fighting, prostitution, soliciting and illegal drug use. It is a special committee under police authority that does the sentencing. While it is possible to demand a defense attorney, seek repeal, or even litigation against the committee, success in fighting sentences is not common.

The actual practice of Chinese authorities is to simply fine casual gamblers. These authorities do use the media to report hundreds of thousands (sometimes millions) of annual gambling arrests. Understand this is sensationalized reporting designed to scare people into believing casual gamblers are often detained, which is not the case.

In 2012 there were an estimated 347,000 citizens prosecuted for gambling offenses. This same year the government claimed success in closing down over 30,000 illegal casinos and breaking up over 10,000 gangs responsible for running these casinos and illegal bookmaking operations. There were also many arrests involving junket operators, web-cam casinos, promoters, agents and banks. This is where the bulk of those prosecutions came from. Of the 347,000 prosecuted, only 5,700 people were sentenced to detention. More than 80% of those sentences were for 15 or less months.

It is important to note that what is done in practice, and what is said, are sometimes two different things. The police authorities claim they are not focused on casual gambling (for example: friends betting mah-jong is not a focus) but there are more than 430 committees for sentencing and each ranking police official has much control in who is arrested and then sentenced. This means it is possible to be arrested and sentenced for casual gambling, it is just extremely rare this happens. The penalty for casual gambling is generally a fine not exceeding 3,000 yuan.

Online Gambling Laws

There is no difference in the level of crime between players betting with illegal land-based casinos or betting with foreign gambling websites. While the government is very active in blocking access to these websites, there are ways to use them and it is very rare to hear of any players arrested.

History of Gambling in China

The gambling policy and government views of gambling developed over the course of many centuries. In this section I cover how it was that gambling became so popular, and progress through the various social and legal developments up until the modern day. First it is important to note that while neither archaeological nor credible written evidence exists to support, some historians claim it existed since at least 2300 BCE.

This dating originated in 1943 when Han era (206 BCE – 220 CE) graves were excavated and the board games Liubo and Boju were found. Chinese history told of these games being played thousands of years earlier. Many failed to account for (or knew) these stories were only written around 100 BCE. As of modern day, the oldest versions ever found of either game date to fourth-century BCE. While it is possible it existed prior, it is worth noting in Iran, India, Iraq, and Egypt much older discoveries have been found. Also, in many of these places – written history tells of gambling long before written history tells of the same in China. And the final note is that there is not much credible information to support the idea either of these games were gambling games.

The oldest archaeological finds of what may have been gaming instruments in China are dice dating to around 600 BCE. The oldest ancient scroll telling of gambling dates to 200 BCE. This tells of a story from the same period. Specifically, of a ruler named Cheung Leung inventing Bái gē piào (白鴿票) to raise money for defence around 200 BCE. His invention was an early form of the game now played in the West called Keno. Accounts of the same story attributing Bái gē piào to having much earlier financed the building of the Great Wall date a few hundred years later and is likely only a legend.

There is much evidence to suggest gambling existed but was not any sort of social phenomenon during the Qing Dynasty (221 to 206 BCE). This is when CuJu – an early form of football (soccer) – developed. Sports betting was one of the most popular early forms of gambling in China. During the Han Dynasty (206 BCE – 220 CE) more and more writing about gambling appeared. As history progressed the stories began telling of gambling in earlier times. There were even references to Cuju being played in 2600 BCE claiming it was a method used to train samurai. No such claims existed in the written findings that date only 100-200 years earlier. This suggests both gambling and sport became widespread during the Han Dynasty.

Early Gambling Laws

The earliest stories of a law prohibiting gambling tell of the Wei Kingdom (403 – 225 BCE) outlawing the activity with a monetary fine for those caught. The first actual legal documents on record that include the Chinese word for gambling (Dǔbó – 赌博) of current time as a legal provision appeared during the Tang Dynasty (618 AD/CE to 907).

It was said during the Tang Dynasty that gambling had infiltrated all walks of society. While dice, tile and card games existed sport was the most popular form of gambling. There were professional Cuju leagues and other sports popular were Jiju (an early form of Polo), Chuiawan (an early form of golf), aerobics and ice-skating. The penalty started as a monetary fine but in time included forced military service. The penalty for military or officials caught gambling was much more severe and included caning and even execution for serious offenses.

At the start of the Song Dynasty (960–1279) Emperor Taizu of Song (Zhao Kuangyin) order that habitual gamblers have their hands chopped off. Military allowing gambling could receive corporal punishment as well. History notes that enforcement against led to a sharp decline in gambling popularity. This however changed during the sixteenth century when European Imperialism in Asia led to many anti-gambling measures becoming less effective.

European Imperialism in China

My article Macau Gambling History covers developments of gambling in China from 1557 onward. This was the year the Portuguese began leasing Macau as permanent base for trading. As they also governed the territory, and there were no laws to prevent gambling in Macau, games such as Pai Gow, CLU-CLU (sic-bo) and Fan Tan were allowed to develop here without fear of prosecution. These were literally played out in the streets. This is a period in Chinese history where gambling really boomed.

It was during the nineteenth century that legal forms of gambling came to China. This can largely be attributed to the incompetency of late Qing Dynasty governments and the need for war funds. Two Opium Wars (1839 and 1856) against the British Empire, and the Sino–French War (1884-85) left China weak. We were unable to resist political interference and territory encroachment by the West, thus leading to the many Unequal Treaties. With China in weaken state Japan saw the opportunity to invade too.

I already mentioned the history of gambling in Macau, but the history of Gambling in Hong Kong is also an interesting read. In short: Macau became a Portuguese colony in 1887 (though was Portuguese governed since 1557) which lasted until 1999. England gained sovereignty of Hong Kong in 1842 which lasted until 1997. Today both are special administrative regions of China with their own governments, laws, passports and currency. Japan controlled many areas of China including Taiwan and Shanghai since 1895. This was brief in Shanghai but lasted until 1945 in Taiwan. You might also be interested in my article on the history of Gambling in Japan.

During these early periods of invasions, gambling in China became widespread. Horse racing was brought to Macau, Hong Kong and Shanghai in 1842. Hong Kong is now home to some of the famous horse racing known worldwide. In 1847 the Portuguese government of Macau began regulating and taxing casinos. Today this the largest casino market in the world in term of net gambling win. Lottery was introduced by Japanese government to Taiwan in 1906. During these periods, games now popular such as Mah-jong developed.

Early Chinese Lottery

Gambling had already spread to China due to foreign powers and occupations here. In 1885 the Qing Dynasty was motivated by Spain’s success in using the lottery to generate tax in preparation for the Spanish-American war. It implemented a similar plan and allowed authorised lotteries to operate legally in exchange for paying tax. The first was started in Canton (Guangdong –which borders Macau) in 1886 called the Wei Seng Lottery (sometimes referred to as surname lottery). There are many archives that discuss this lottery: you can read a newspaper article from 1893.

Rigged Games

It did not take long for the idea of legal lotteries to sour. In 1905, a Fujian lottery company conducted 17 lottery draws with the jackpots rigged so that their own friends and relatives would win. During this ordeal angry mobs were lied to by the police who later lied in court. The press revealed the truth in great detail and afterwards lottery was banned in the province. A short while later, similar scandals were uncovered in Zhejiang and Anhui provinces. The ban on lottery was then expanded to include their provinces as well.

”Republic of China”

Lottery and all other forms of gambling were initially banned in the “Republic of China” (1912-1949) which is the period between the end of the Qing Dynasty (1644-1912) and the start of The People’s Republic of China (1949-Current). Upon its establishment, the Nanjing Provisional Government banned lotteries in the Provisional Constitution. Soon later guidelines set the fine for purchase of lottery tickets at one-hundred yaun plus two times the cost of the purchase.

However, China was frequently at war and in the period known as the era of Beiyang Government where various warlords ruled. Under the guise of raising money for charity and relief many lotteries such as Xiang Relief Charity, Hubei Prize Pay, Law and Business Raffle, Hubei Military Aftermath Prizes, Shandong Industrial Vote, Zhejiang Association and others were allowed. It is believed a lot of this money just went to the warlords to grow fat. Illegal casino and horse race betting were popular under these warlord governments too.

On March 10, 1928 Kuomintang Government created several gambling laws and added them to the Penal Code. Interesting enough, these were the exact same laws right to down to article numbers and text that are used now in Taiwan, which you can find in my article on Taiwan Gambling Laws. This is because KMT was the government until they retreated to Taiwan in 1949, at which point the People’s Republic of China (PRC) was established. During KMT governance of mainland China there were several approved lotteries such as Huang He lottery and the Aviation lottery.

People’s Republic of China

Our country was established as the People’s Republic of China (PRC) in 1949 when the Chinese Civil War between Communist Party of China (CPC) and Kuomintang (KMT) that had begun in 1927 neared its end. It was Mao Zedong who in that year declared the founding of PRC as a one-party socialist state controlled by the Communist Party. He governed the country as Chairman of the CPC until his death in September 1976.

Mao Zedong considered gambling one of the great ills of socialist society and banned all forms, including lottery, nationwide since PRC was founded. In 1957 his government created the re-education through labour program used to this day to punish certain gambling offenses. In 1966 he launched a nationwide campaign called the Cultural Revolution that was a program to eliminate counter-revolutionary elements in Chinese society. During this period the mere act of playing mah-jong (even with no gambling involved) was a crime.

Following the 1976 death of Mao Zedong much change in China began. In the 1980’s the Mahjong law was repealed. In 1984, the Beijing International Marathon took place. In order to raise funds the Chinese Athletic Association offered sports betting on the event. The following year such activity became regular practice of the National Sports Commission and was approved by the State Council.

The government made moves in 1986 to restrict sports betting, but it remained a topic of internal debate. In 1987 the tides turned entirely with creation of our current Welfare Lottery. If this is a topic of interest to you then I suggest reading a 1987 interview that OnlineBetting.com has added to Google Docs. This properly explains the reasons why legal gambling returned to China. It was from here the gambling in China of today all developed. You can learn about it including our many lotteries, legal sports betting, and our newest popular form of gambling which functions similar to slot machines in my article titled Gambling in China.